The 25-year-old Spanish international has struggled for recognition in Real Madrid’s stellar squad and has found himself falling down the Bernabeu pecking order over the course of the past year.

The arrival of Toni Kroos from Bayern Munich last summer and the consistent displays put in by Luka Modric have severely hampered Illarramendi’s progress at Real Madrid.

Liverpool failed with a €14m (£10m) bid for the defensively minded midfielder and are now ready to offer €20m (£13.8m) according to Fichajes.

Brendan Rodgers has already brought in a host of new additions over the summer but there is no doubting that Illaremendi could greatly improve the Anfield side’s central midfield options.

Brazilian Lucas Leiva has struggled greatly with injuries of late and Joe Allen has not impressed when called upon. The departure of Steven Gerrard has further restricted the level of quality which Rodgers can call upon.

Liverpool have already signed James Milner, Adam Bogdan, Danny Ings, Joe Gomez, Roberto Firmino and Nathaniel Clyne but have balanced the books with the £49m sale of Raheem Sterling to Man City (via Goal.com).

Rodgers is also closing in on Aston Villa forward Christian Benteke with Liverpool having triggered the Belgian’s release clause with their bid of £32.5m (via BBC Sport).

Things are certainly looking rosier for the Merseyside outfit this summer with the club’s American owners ready to bankroll significant transfer activity and Brendan Rodgers will hope his side can push back into the Premier League top four in 2015/16.